Exchange Traded Funds (ETFs), in general terms, are funds that track indexes like the NASDAQ-100 Index, S&P 500, Dow Jones, etc., but are traded like stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold. Accordingly, ETFs provide the diversification of an index fund as well as the ability to sell short, buy on margin, and purchase as little as one share.
Many ETFs exist. For example, the Spider is an ETF that tracks the S&P 500 index, and the DIAMONDS Trust is an ETF that tracks the Dow Jones Industrial Average. Another ETF, the Direxion Daily Small Cap Bull 3× Shares fund (the TNA fund), is based on the Russell 2000 index but is traded at three times the movement of the Russell 2000 index. For example, if the Russell 2000 index moves 2%, the TNA fund will move 6%.